Gas export group collaborate on price

The 13-member Gas Exporting Countries Forum (GECF) have agreed to work together to achieve a “fair price,” the group’s Secretary-General Leonid Bokhanovsky has said.

“Once the majority of gas exporters agree and commit on uniform behaviours in the market, we could be expecting desirable decisions to be made and effective actions to be taken which is in line with the objectives of the forum,” Bokhanovsky, said in an e-mail, on the fourth anniversary of the group.

He said GECF has been less effective than the Organisation of Petroleum Exporting Countries (OPEC), which meets twice yearly to tweak crude-oil output quotas with the aim of influencing prices, and has been in existence since 1960.

GECF’s members, who hold almost 60 per cent of the world’s gas reserves, said at a summit in November 2011 that they should cooperate to raise prices and boost supply, yet they disagree on how that can be achieved, he lamented.

Qatar’s Emir, Hamad Bin Khalifa Al Thani, said at a summit earlier that the group shouldn’t try to limit output, while Iran’s Oil Minister, Rostam Qasemi called for the group to develop a “market management plan.”

The majority of gas is sold in long-term contracts tied to oil and is expensive to transport, making the market for the fuel more regional than crude, which is mainly bought and sold on the spot market.

GECF members defended oil-linked contracts at their most recent meeting in Equatorial Guinea on November 21.